Turkish Ruling Party Official Resigns Amid Stock Market Manipulation Scandal
A top official in Turkey's ruling AKP party resigned after the opposition accused her and her husband of making massive stock profits ahead of an investment fund crash.
Fatma Betül Sayan Kaya, a deputy chair of Turkey's ruling Justice and Development Party (AKP) and former family minister, resigned from all her positions on Saturday night. The resignation followed accusations from the main opposition party that she and her husband reaped massive profits from stock trades shortly before a major investment fund crisis hit the country. The scandal, centered on suspected stock price manipulation, crashed the stock market two weeks ago, leading to the liquidation of 131 funds and the arrest of dozens of suspects.
The crisis began in late August when Turkey's Capital Markets Board (SPK) banned investment funds from concentrating all their assets in a single stock, requiring portfolio diversification. Regulators feared that numerous funds had channeled massive sums into a handful of small, thinly traded companies. To comply with the new rules, funds began selling off holdings, triggering panic among investors. By mid-September, several private management firms admitted insolvency, Istanbul's stock exchange plummeted, and authorities ordered the liquidation of funds valued at roughly $17 billion, affecting over 455,000 investors.
Opposition Allegations and Political Fallout
Zeynel Emre, a spokesperson for the New Party—which emerged as a key opposition force after splitting from the Republican People's Party (CHP)—claimed that Kaya and her husband İlyas invested 163 million liras in April, primarily in shares of the shipbuilding firm Ozata Denizcilik, later selling them for roughly 2.17 billion liras. Emre stated that Kaya personally invested 63 million liras and recovered about 1.3 billion liras as Ozata shares surged from 220 liras in April to 4,980 liras on September 15, just ahead of the collapse.
Kaya announced on X that she requested President Recep Tayyip Erdogan to relieve her of all duties.
I believe it is necessary to take political responsibility so that my role does not become a subject of public debate, and so that the investigation can proceed independently, impartially, and free from any suspicion or undue influence.
While she did not address the specific allegations against her, Turkish media reported that Erdogan accepted her resignation, and Istanbul's chief prosecutor's office moved to freeze assets belonging to her, her husband, and their children. AKP spokesperson Ömer Çelik vowed that the fight against all forms of wrongdoing would be conducted without compromise, stating that any irregularities would be thoroughly investigated.
Broader Economic and Government Response
The scandal has led to the arrest of 51 individuals, including a former deputy governor of the central bank and the chairman and deputy chairman of Ozata Denizcilik. The crisis also sparked rumors regarding Finance Minister Mehmet Şimşek potentially resigning, though he dismissed the reports as entirely baseless. Speaking to Turkish journalists on the sidelines of the UN General Assembly in New York last week, President Erdogan attempted to downplay the fallout, insisting that there is no risk to the financial system or the Turkish economy and promising that all responsible parties will face justice.
